Look who's driving design
Toyota's new Scion points to a new industry premise: Boomers may hold the wealth, but brand-loyal youths hold the key to a carmakers' long-term success.
The Scion is not your father's Toyota. But he might have bought one if it had been around when he was a young buck.Skip to next paragraph
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Or so Toyota believes.
The boxy vehicle introduced this month in California represents the giant automaker's first major launch since its Lexus line more than 10 years ago. More important, it represents a bid for young buyers - an aggressive move to address its concern that a key demographic is shunning the brand.
"These [young] customers won't look at a Toyota, because you see them everywhere," says James Farley, president of Scion, also the name for the newest division of Toyota Motors North America.
Similar concerns pervade many business sectors today - and have been especially acute in the auto industry since the fall of Oldsmobile, which simply couldn't find enough buyers under 70 years old.
That failure - and the struggles of American firms from J.C. Penney to Levi Strauss - is forcing marketers to revive the perennial question: What do kids want? Companies from corner boutiques to global conglomerates are all trying to influence tomorrow's adults about what the next big trend should be.
Toyota's saga illustrates the sway young consumers hold. In addition to recasting its image, the carmaker is trying to persuade trendsetting teens and young adults - consumers who traditionally buy used cars - to buy their next vehicles right out of the showroom.
"It's really arrogant, actually, that we're trying to tell trendsetters what to do," says Mr. Farley.
If Scion succeeds, Toyota stands to secure brand loyalty. It also hopes that the tastes of its newest buyers may be adopted by mainstream consumers and produce a big, long-lasting payday. The carmaker's long-term aim is to pass General Motors as the world's No. 1 seller.
But to succeed, it will have to work quickly to capture current and future buyers in the largest and most diverse generation in US history: Generation Y. That group, when expanded to include so-called millennials - people ages 8 to 23 - encompasses some 60 million people.
"These generations are going to have to get shorter and shorter as the culture speeds up," says Carolyn Martin, faculty dean of Rainmaker Thinking, a think tank working on generational issues. People close in age "don't have anything in common culturally."
Automakers, with their long development cycles, are at an even greater disadvantage than many merchants who've grown up with baby-boomer customers. To catch trends early enough, they have to look to the very fringes of the culture to pick up on the next big thing, says Watts Wacker, a futurist and president of FirstMatter, a think tank in Westport, Conn.
"Trends are born in nasty, nasty places," he says. And if a company wants to find the next trend before it emerges, "they have to hire a deviant to take them to 'deviant land.' " If trucks are now mainstream, for example, and retro vehicles are trendy, "sleeping in your car is on the fringe," he says.
But even after all the focus groups and trips to 'deviant land,' Farley and his team have come up with a car that they think will satisfy these kids. The problem is, middle-aged executives admit they have no innate sense of whether they've hit the mark. "I'm 40, and I don't get the xB," Farley says of Scion's flagship model.
The xB can be described as a tiny mobile breadbox, a toaster on wheels, or a Matchbox-size SUV. The other model, the xA, is similar and even smaller. Farley says both vehicles are not anti-SUVs, but urban, alternative SUVs.
Regardless, automakers are hoping young folks will latch onto anything that looks industrially ugly. Think Honda Element, Toyota Matrix, Pontiac Aztek, and Suzuki Aerio.
The problem is that historically, youths reject what grownups like. To make matters worse, many times what kids like, adults do, too - which in turn drives away the youth market.